Asian stocks only gained modestly after a lift in US consumer confidence drove the S&P 500 to above a closing level of 2,000 for first time, reports FTAdviser sister title FastFT.
Sydney’s S&P/ASX 200 rose 0.2 per cent and South Korea’s Kospi Composite jumped 0.4 per cent, while Hong Kong’s Hang Seng was flat.
Japan’s Nikkei 225 began the session higher but after the yen strengthened 0.2 per cent the average pared gains and declined 0.3 per cent.
Overnight, US stocks edged up 0.1 per cent to fresh record highs and their European counterparts hit their best levels in a month as the markets continued to focus on the prospect of further policy accommodation from the European Central Bank.
But aside from a US consumer confidence index rising to a post-crisis high, “not a lot changed” in the overnight session, according to analysts at Credit Agricole. “Market tone remains positive with European indices leading the gains once again,” they said,
The New Zealand dollar rose 0.4 per cent after Auckland-based Fonterra, the world’s largest dairy exporter, announced two major investments. Dairy is New Zealand’s number one export.
Fonterra is investing NZ$555m to increase milk processing capacity at home and spending another NZ$615m to partner with China-based infant fomula maker Beingmate to expand its penetration of the China market.
Annette Beacher, economist at TD Securities, called the investment “massive”, noting it should help to keep New Zealand GDP “expanding at least at a trend pace if not higher for longer.”
Fonterra CEO Theo Spierings said the NZ$18bn infant formula market in China is expected to double within half a decade, “driven by increasing urbanisation, higher disposable incomes, a preference for premium brands, and relaxation of the one child policy.”
In Australia, iron ore mining stocks rebounded after some heavy losses in recent days, despite the price of the steelmaking ingredient continuing to fall overnight. Iron ore prices dropped 0.3 per cent to a two-year low just under $89 per metric tonne.
